Corporate Governance

Minnesota Court Delays Decision on Pension Cuts

By Anthony F. Maul

A judge in Minnesota?s state District Court has declined to render a decision on whether or not to grant the State summary judgment against a class of current retirees who have challenged proposed cuts to their benefits.  The litigation, captioned Swanson v. Minnesota, No. 62-cv-10-5285, arises from legislation enacted last year that lowers or eliminates annual benefit increases for retirees until the state pension fund is 90% solvent.  The case is being watched both as a potential weathervane for similar cases pending in other states (including Colorado and South Dakota), as well as a guidepost for what other state legislatures may do to confront underfunded pensions.  However, during a hearing last week, Judge Gregg E. Johnson deferred judgment 90 days in order to allow the plaintiffs to conduct document discovery and depositions probing the State?s internal deliberations with regard to its pension gap.  It remains to be seen how the facts disclosed in discovery will impact that court?s evaluation of the retirees? claims, or whether summary judgment will be back on the table in three months.   

Full post as published by PomTalk on September 22, 2010 (boomark / email).